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How Outdated Data Distorts Doctors' Pay 336

Hugh Pickens DOT Com writes "Peter Whoriskey and Dan Keating report at the Washington Post that Medicare annually pays $69.6 billion for physician services according to an arcane and little-known price list, known as the Relative Value Update over which doctors themselves exercise considerable and less-than-totally-transparent influence. A 31-member committee of the American Medical Association (AMA) recommends what Medicare should pay for some 10,000 procedures — with the fees based in part on how long it takes to complete each one. But this time-and-motion study often fails to take full account of changing technology and other factors affecting physician productivity, so anomalies result. For example, if the AMA time estimates are correct, then 41 percent of gastroenterologists were typically performing 12 hours or more of procedures in a day, which is longer than the typical outpatient surgery center is open and and one gastroenterologist in the Post story would have to work 26 hours, according to the committee time estimates, to accomplish what he gets done in a typical workday. Here's how it works: Medicare pays for a 15-minute colonoscopy as if it took 75 minutes resulting in a median salary for a gastroenterologist of $481,000. It is possible that in 1992, critics allow, when the price list was first developed, a colonoscopy actually took something close to 75 minute when doctors had to hunch over an eyepiece similar to that of a microscope for a look. But technology has advanced and now the images are processed and displayed on a large screen in high-definition video. Responding to criticism that the nation's method of valuing medical procedures misprices payments, a bipartisan group of legislators has drafted a bill that would reshape the way the nation pays doctors. The bill would require Medicare officials to collect data such as how much time doctors spend doing procedures and reducing the doctor payment for overvalued services. 'What started as an advisory group has taken on a life of its own,' says Tom Scully, who was Medicare chief during the George W. Bush Administration. 'The idea that $100 billion in federal spending is based on fixed prices that go through an industry trade association in a process that is not open to the public is pretty wild.'"
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How Outdated Data Distorts Doctors' Pay

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  • Technology costs? (Score:3, Insightful)

    by JaySSSS ( 859968 ) on Tuesday July 30, 2013 @08:21AM (#44421735)

    So, it appears the article only talks about the time spent by the physician. I'm curious if the costs of the tools/technologies of these procedures have gone up, and how the doctors get paid for those (potentially) increased costs?

  • by Shoten ( 260439 ) on Tuesday July 30, 2013 @08:25AM (#44421763)

    So, it appears the article only talks about the time spent by the physician. I'm curious if the costs of the tools/technologies of these procedures have gone up, and how the doctors get paid for those (potentially) increased costs?

    Well, that's another part of the problem, I would say. If one cost isn't getting addressed/monitored, and the way to try and offset it is to have another cost kept arbitrarily high in a way that does not reflect reality, then you're going to lose visibility into the real economics of it all and get undesired effects. Add in the fact that a trade association representing the vendors (in this case) is a major driver in the price determination process and the lack of transparency, and you increase the likelihood of undesired effects even further, and practically guarantee that anyone who looks upon the result will question it.

  • by gandhi_2 ( 1108023 ) on Tuesday July 30, 2013 @08:32AM (#44421811) Homepage

    We all know that medical procedures require no setup, cleanup, assistance, explanation, or double checking, and of course are only done by one single doctor and no staff. Biling and coding, technology costs and training, facility costs.... those don't count either.

    Clock in, surgery, clock out.

  • by thaylin ( 555395 ) on Tuesday July 30, 2013 @08:42AM (#44421875)
    The bill is usually itemized and accounts for these things. We are talking specifically about how much time the doctor is working on the case of the patient. They are billing at a rate for only being able to do one of these things a day, but are able to do 26, so their pay, at the cost the tax payer, has ballooned.
  • by NicBenjamin ( 2124018 ) on Tuesday July 30, 2013 @08:56AM (#44422005)

    Lawyers study as long as Doctors, get as many loans, and make less. Most Law School grads make under $50k. Vets are worse. It's harder to get into vet school then MedSchool, the coursework is harder (you have to know medical care for multiple organisms), the loans just as bad, and $50k is a really good salary for a Vet. Hell do you think ANY humanities PhD is ever gonna pay off his student loans?

    I would have a lot more sympathy for American Doctors if their foreign counterparts didn't make do with a much less pay. Luxembourg is an incredibly expensive country to live in, yet their Doctors make 30% less then our doctors. Yeah we overpay our MBAs, and MPHs, but it's very hard for me to sympathize with a guy who does the exact same job as a Doctor from Winnipeg for $40,000 more and complains he isn't paid enough.

  • by h4rr4r ( 612664 ) on Tuesday July 30, 2013 @08:57AM (#44422009)

    Bullshit. The simple fact is that tort reform does not lower costs, look at Texas to see this. What it does do is mean that you can be crippled by a doctor, forever unable to work and get less than he makes in a year out of it.

    If you want to make that kind of money you have to be willing to take some risk. Tort reform is simply the doctors privatizing the profits and socializing the losses when they fuck up. This is because once those meager limited payouts runout we as a society have another person to pay for on disability.

  • by smittyoneeach ( 243267 ) * on Tuesday July 30, 2013 @10:25AM (#44423001) Homepage Journal
    Then talk to them after ObamaCare is fully inserted, and they lack any/good health insurance AND lack whatever cash they had!
  • by geminidomino ( 614729 ) on Tuesday July 30, 2013 @11:36AM (#44424007) Journal

    If you engage in a bunch of communist nonsense to devalue the work of doctors, people will stop becoming doctors for the money.

    Fixed that for you. As a side effect, medical schools will have to decide between re-purposing themselves to underwater basket weaving or, just maybe, not costing a quarter of a mil.

    This applies to anything. The cost of overhead doesn't pay itself.

    I'm a miserable, cynical bastard at the best of times, but this ridiculous idea that money is the only reason anyone does anything is just sad.

    All things aren't created equal. People who advocate that capitalism must apply to the care and ease of human suffering should be subject to having their organs harvested.

  • by unitron ( 5733 ) on Tuesday July 30, 2013 @11:46AM (#44424153) Homepage Journal

    I see it as the hospital trying to cover some of the bills on which they never collect.

  • by Anonymous Coward on Tuesday July 30, 2013 @05:05PM (#44428495)

    Yes, it looks like such rough times [] for cardiologists [].

    This may not be making as much money as you wanted, but you are well above the income that most people would call "rich". You should be able to pay off those student loans in no time if you can manage to live frugally (by this I mean not spend too much more than twice the average US income) for under one year.

  • by vivian ( 156520 ) on Wednesday July 31, 2013 @07:44AM (#44433335)

    I don't think $451,000 is unreasonable pay for someone who has to look up diseased arses all day to help prevent their owners dying a horrible death - with the prospect of being sued into oblivion if you make a mistake? Sure it's s lot of money, and definitely on the high side, but I think I'd still rather be a programmer earning less than 1/4 of that compared to doing that job. You thik the goatse guy is bad? I reckon a day in the office looking over a proctologist's shoulder would make it look like kittens.

    The tens of millions paid for company executives in charge of companies that take a nose dive and have to be bailed out by taxes? Now that's unreasonable.

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